A person subscribed to the capital increase of a company (“Company”) but backed-out shortly after, without succeeding in obtaining the restitution of the funds disbursed, even after having initiated proceedings before various trial judges.
The Company initiated arbitral proceedings against the subscriber on the basis of the arbitration clause included in its bylaws. To overcome the subscriber’s silence, the President of the Commercial Court issued an interim order in which it designated the arbitrator of the subscriber and ordered the two designated arbitrators to jointly appoint the third arbitrator in order to constitute the arbitral tribunal. The subscriber commenced proceedings before the Court of Appeal requesting the annulment of the order and the recognition of his lack of consent to the bylaws and to the arbitration clause provided therein, which he seeks to be declared void by the Court.
The Court of Appeal dismisses all of these claims. The Court finds that insofar as all the shares had been released at the time of their purchase for approximately 480,336.64 euros, the appellant had clearly expressed his desire to join the Company as a partner and had thus committed himself to respect the bylaws. The Court adds that the bylaws were applicable and valid. Therefore, it is without exceeding its jurisdictional powers, and in accordance with the bylaws and the arbitration clause, that the interim relief judge (juge des référés) was able to rule as a supporting judge (juge d’appui), issuing an order not subject to appeal in accordance with Article 1460 of the Code of Civil Procedure. Finally, the Court states that the exercise of a remedy accounts for an abuse of rights only in cases of bad faith, fraudulent intent or mistake equivalent to a fraud, which was not the case in this case.